More on Responses to Foreign Subsidies

Yesterday brought news of an AC/CVD petition in the U.S. in relation to imports of Chinese solar panels. Here's the FT:

A coalition of US solar panel manufacturers asked on Wednesday for retaliatory tariffs on imports of panels from China, the first such case filed in the renewable energy sector.

A group of seven companies led by Solarworld, an Oregon-based solar cell and panel manufacturer, asked for anti-dumping tariffs and countervailing duties, which are imposed on goods deemed to be priced unfairly low and receiving government subsidy. “Artificially low-priced solar products from China are decimating the domestic industry,” said Gordon Brinser, president of SolarWorld.

Timothy Brightbill, a lawyer with Wiley Rein, the law firm representing SolarWorld, said the case would seek anti-dumping tariffs of more than 100 per cent on solar cells and panels from a wide variety of Chinese manufacturers. “China has a system of pervasive and illegal subsidy payments,” he said, including government cash grants and subsidised loans to the industry and subsidised raw material inputs. China had gone from an 8 per cent to 45 per cent share of the US solar market since 2008, Mr Brightbill said.

I first heard about the case through an email I received from SolarWorld's PR firm:

On behalf of our client, SolarWorld Industries America, I wanted to send you a quick email about an announcement they plan to make today in Washington, DC. SolarWorld, a member of the newly-formed Coalition for American Solar Manufacturing (CASM), will announce a major trade action against foreign manufacturers.

SolarWorld will allege illegal activities that have resulted in job cuts, losses in shipments and harm in operating margins. The surge in foreign solar cells imports has resulted in the elimination of thousands of jobs in Arizona, California, Massachusetts, Maryland, New York and Pennsylvania.

Gordon Brinser, President of SolarWorld Industries and CASM spokesperson, Senator Ron Wyden (D-OR) and Senator Jeff Merkley (D-OR) will speak at this press conference. We apologize for the late notice, but as a blogger that covers this issue, we would like to invite you to this event.

Just to see what would happen, I responded with the following questions:

How do you respond to the charge that American solar companies have been subsidized as well? Would you say that they have not been subsdized, or would you say that the foreign subsidies are higher?

Also, I assume you are planning to bring a countevailing duty case. Would you prefer a WTO complaint? If USTR were to bring a WTO complaint, would you forgo the CVD case?

Here's the response I got from Ben Santarris, Head of Corporate Communications and Sustainability for the Americas of SolarWorld:

1. First off, SolarWorld has not received any federal government subsidies. We have received some state and local government subsidies, but they are available to any manufacturing firm in the region and not specific to solar (they would also be available to any Chinese firm operating in Oregon). There are some U.S. subsidies, but they are small compared with the subsidies given by the Chinese government. Moreover, there are WTO-legal subsidies and WTO-illegal subsidies. In our case, we are targeting China's WTO illegal subsidies.

2. We filed an AD and CVD case. We are concentrating on our petitions, but would welcome a continuation of USTR's ongoing investigation of Chinese subsidies. Finally, we are not going to speculate on what USTR may or may not do in the future. We are concentrating on the next steps in our case -- a preliminary ITC hearing on November 8.

It will be interesting to see how China responds. No doubt they will contest the case vigorously in the trade remedy proceedings, the U.S. courts and at the WTO. Will they also try to make an issue of whatever subsidies the U.S. industry has received?

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Yesterday brought news of an AC/CVD petition in the U.S. in relation to imports of Chinese solar panels. Here's the FT:

A coalition of US solar panel manufacturers asked on Wednesday for retaliatory tariffs on imports of panels from China, the first such case filed in the renewable energy sector.

A group of seven companies led by Solarworld, an Oregon-based solar cell and panel manufacturer, asked for anti-dumping tariffs and countervailing duties, which are imposed on goods deemed to be priced unfairly low and receiving government subsidy. “Artificially low-priced solar products from China are decimating the domestic industry,” said Gordon Brinser, president of SolarWorld.

Timothy Brightbill, a lawyer with Wiley Rein, the law firm representing SolarWorld, said the case would seek anti-dumping tariffs of more than 100 per cent on solar cells and panels from a wide variety of Chinese manufacturers. “China has a system of pervasive and illegal subsidy payments,” he said, including government cash grants and subsidised loans to the industry and subsidised raw material inputs. China had gone from an 8 per cent to 45 per cent share of the US solar market since 2008, Mr Brightbill said.

I first heard about the case through an email I received from SolarWorld's PR firm:

On behalf of our client, SolarWorld Industries America, I wanted to send you a quick email about an announcement they plan to make today in Washington, DC. SolarWorld, a member of the newly-formed Coalition for American Solar Manufacturing (CASM), will announce a major trade action against foreign manufacturers.

SolarWorld will allege illegal activities that have resulted in job cuts, losses in shipments and harm in operating margins. The surge in foreign solar cells imports has resulted in the elimination of thousands of jobs in Arizona, California, Massachusetts, Maryland, New York and Pennsylvania.

Gordon Brinser, President of SolarWorld Industries and CASM spokesperson, Senator Ron Wyden (D-OR) and Senator Jeff Merkley (D-OR) will speak at this press conference. We apologize for the late notice, but as a blogger that covers this issue, we would like to invite you to this event.

Just to see what would happen, I responded with the following questions:

How do you respond to the charge that American solar companies have been subsidized as well? Would you say that they have not been subsdized, or would you say that the foreign subsidies are higher?

Also, I assume you are planning to bring a countevailing duty case. Would you prefer a WTO complaint? If USTR were to bring a WTO complaint, would you forgo the CVD case?

Here's the response I got from Ben Santarris, Head of Corporate Communications and Sustainability for the Americas of SolarWorld:

1. First off, SolarWorld has not received any federal government subsidies. We have received some state and local government subsidies, but they are available to any manufacturing firm in the region and not specific to solar (they would also be available to any Chinese firm operating in Oregon). There are some U.S. subsidies, but they are small compared with the subsidies given by the Chinese government. Moreover, there are WTO-legal subsidies and WTO-illegal subsidies. In our case, we are targeting China's WTO illegal subsidies.

2. We filed an AD and CVD case. We are concentrating on our petitions, but would welcome a continuation of USTR's ongoing investigation of Chinese subsidies. Finally, we are not going to speculate on what USTR may or may not do in the future. We are concentrating on the next steps in our case -- a preliminary ITC hearing on November 8.

It will be interesting to see how China responds. No doubt they will contest the case vigorously in the trade remedy proceedings, the U.S. courts and at the WTO. Will they also try to make an issue of whatever subsidies the U.S. industry has received?